Hudson Valley Special Report: Business Confidence

First Quarter 2003

Marist College

June 2003

The assistance of Kevin Edson, Shivan Durbal, and Chris Trocino is gratefully acknowledged.
Also, the cooperation of the Council of Industry of Southeastern New York is appreciated in
the conduct of the Business Confidence Survey.

Exhibits

Introduction

In cooperation with the Council of Industry of Southeastern New York, a business confidence survey of regional companies was conducted in May, 2003.
Expectations for profits, sales, investment, and employment remain strong, although with some deterioration compared with the same survey conducted
last fall.

Business Confidence Survey

A total of 136 firms responded to the business confidence survey of Spring, 2003, conducted in May, 2003. The sample was distributed across the
region, and included manufacturing firms as roughly half of the respondents.

By examining the average rank of the responses, it is possible to compare the responses this spring with the same survey conducted in November,
2002. The average rank for expected profits and sales next year decreased slightly, compared with the fall survey. There was virtually no change in the
average rank regarding expectations of materials prices and investment. There was a slight decline in expected employment levels for next year.

Overall the responses remained optimistic. Nearly half, 47% of the respondents, expected profits to be higher or much higher next year, compared
with only 6.6% who expect lower or much lower. Over half, or 51.4%, expect sales to be higher or much higher next year, compared with 6.6% who expect
lower or much lower sales.

Only 36.7% expect materials prices to be higher or much higher next year, compared with 55.8% who experienced higher materials prices last year.
Over one quarter, 25.7%, expect investments to be higher or much higher next year, compared with only 9.6% who expect investment to be lower. Nearly one
quarter, 23.6%, expect employment to be higher or much higher next year, compared with only 5.9% who expect employment to be lower.

Sources: Cooperation of the
Council of Industry of Southeastern New York and the Hudson Valley Technology Development Center in the conduct of the business survey is greatly
appreciated.